Wednesday, 6 March 2013

another lament about economic history in Germany...

The German weekly Wirtschaftswoche has a small article about the decline of economic history in Germany. Apart from the fact that they got the offers that some people declined wrong (tough business that, Munich is not Berlin), it is also interesting in a number of dimensions. It laments the fact that some German economic historians now teach abroad. The article is right that chairs are being closed down or re-designated, and that there is little love of economic history in most German economics departments. But in my view, it gets two crucial things wrong.

First, the fact that some Germans teach abroad in itself is not a sign of crisis or decline; it is perfectly normal in a globalized world. What is problematic is the fact that there are almost no foreigners going to Germany to take up teaching positions there - it's the inflows, darling, not the outflows. In this day and age, there is nothing natural about locals teaching local students in their local university; it's a recipe for provincialism.

The fact that only Germans - by and large - teach at German universities of course has something to do with terms and conditions (lots of teaching, lousy pay). If you want to do research, look no further than the May issue of the AER (gated). Every year, they publish the results of their salary survey. The pay rate for full professors at first-tier US research universities (rank 1-15) was $224,000 - for 9 months of the year (that means you can earn another 2/9 of that if you have grant or your employer is generous - we are talking around $273,000 p.a.). The is 47,000, meaning that most salaries fall in the interval $150-300,000. From what I hear and see, not many German offers exceed €100,000 by a healthy margin, if they ever get there [and with much higher taxes to boot). Put another way, if you paid the players in Bayern Munich in relative terms what German professors earn compared to the international market wage, they would be kicking balls in the local league. Why expect a different outcome in academia?

The inability to hire foreigners also has to do with the use of German as a language of instruction. Let's face it (with apologies to the French): English is the lingua franca of the modern age; it is to economists, physicists, and statisticians what Latin was to Erasmus. At UPF, all graduate instruction (and 1/4 of undergrad instruction) is in English. You can really only hire foreigners if you forget about the idea that they have to learn one of the hardest grammars in the world.

The second mistake, in my view, is that many German economic historians ended up in an intellectual no-man's land -- not economics, but not really history, either, where echist is thoroughly unloved by historian colleagues increasingly smitten by the weird and wonderful babble of the linguistic turn. Put another way, before people pound the lectern with their clogs demanding to be loved by all and sundry, they could perhaps try to contribute a little more to the intellectual debate in economics. The article cites Davide Cantoni, who - for a year that was much too short - was my colleague here at UPF - to the effect that economic history can thrive if it integrates more into economics. I think that is exactly right: I am actually quite sanguine that the better German econ departments would welcome first-rate applied researchers like Davide with open arms, independent of whether they use old data or not. Now, if only the government found it within its heart to pay professors a reasonable premium relative to school teachers... (the constitutional court the other day declared professor's pay illegal in Germany because it is too low - no joke).

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